Starting out as a fizzy drinks company, PepsiCo was born in 1965 when Pepsi-Cola merged with Frito-Lay Inc., and has since become one of the leading food and snack companies in the world. Brands like Doritos, Fritos, Walkers, Quaker and Pizza Hut are now as financially significant as Pepsi Cola, 7Up and Mountain Dew, and the company continues to grow with a presence in 200 countries and revenues of over $66 billion in 2013.
PepsiCo’s interests in Asia include operations in China, India, Korea, Japan, Bangladesh—and Pakistan, which is among the company’s fastest growing markets. PepsiCo moved into Pakistan in 1967 with its carbonated drinks and has grown over the last half-century to become “the single largest food and beverages company in the country”, according to an article in The Express Tribune, an English-language Pakistani newspaper and website partnered with the International New York Times.
The company began manufacturing snack foods in its Lahore factory in 2006, starting with the popular Lays brand. The factory now employs over 1,000 people and has been growing “in the high double digits”, according to Qasim Khan, a senior executive in PepsiCo’s Asian region management team. Key to PepsiCo’s expansion strategy is the use of subcontractors and franchising, which mean the company itself is not necessarily directly involved in employing workers. The result is that the company effectively encourages discriminatory employment practices and has become involved in a number of union-bashing cases, most notoriously in West Bengal where the sacking of workers who joined a union at a warehouse operated by Radhakrishna Foodland Pvt Ltd (RKFL) under an exclusive contract with PepsiCo. This is considered to be a breach of human rights by the IUF which has been running a Stop PepsiComplicity campaign since 2013.
The situation in Lahore seems to echo the events at RKFL’s warehouse in India and may demand a similar international campaign. Here too PepsiCo, which claims to have a rigorous supplier code and a strong dedication to international human rights standards, risks a global labour movement response to what may seem like a little local difficulty.
Despite its sustained growth, workers at the PepsiCo Frito-Lay plant in Lahore have until recently been subjected to “abusive precarious employment practices and discrimination”, according to the IUF (International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Associations). The “abusive precarious employment practices” involve the use of labour contractors, whose unfair contracts deny workers of many years standing the right to permanent employment. The workers seek equal treatment with direct employees for anyone whose terms and conditions are governed by a third party contract. This is increasingly recognised as the ethical approach to contracting and agency work and has been adopted by a European Union directive now being rolled out in all the EU’s member states.
The Frito-Lay workers began organizing more than a year ago with the support of the Pakistan Food Workers’ Federation (PFWF), an IUF affiliate. The new PepsiCo Workers’ Union (PWU) was formally established at an inaugural congress in May this year, when the new union’s leadership was elected. It has 650 members including 150 women.
After a verification process, the union was officially registered by the Pakistani government on June 18, and five days later, it was granted legal collective bargaining status.
However, PepsiCo management at the Frito-Lay plant responded to the creation of the new 650 strong union with a coordinated programme of harassment and deception.
Union officers have been targetted for disciplinary procedures on false charges and the union president has been transferred out of the plant to prevent contact with members. The company has registered a fake national union claiming to represent workers at two different sites in order to undercut the Lahore workers’ demand for a negotiated collective agreement. Union members are being denied overtime and pressured to leave the union.
A large number of workers, including women workers, have been holding protest actions at the factory gate, demanding that the company cease its attack on rights and negotiates in good faith. You can support their struggle.
CLICK HERE TO SEND A MESSAGE TO PEPSICO, telling the company to respect trade union rights at the Lahore plant and end its ongoing complicity in violations of the rights of workers who were unfairly dismissed and then denied re-employment for defending their rights at a warehouse in West Bengal India contracted exclusively to PepsiCo.
Food and beverages: Pakistan among PepsiCo’s top 10 non-US markets, The Express Tribune, 13 January, 2013, Karachi
Despite lead, Pepsi aims for bigger piece of the cake, The Express Tribune, 17 July, 2012, Karachi]
IUF Campaign Announcement, 8 September, 2016, IUF, Petit-Lancy, Switzerland
IUF Urgent Action, 8, September, 2016, IUF, Petit-Lancy, Switzerland